No Santa this year
The economy doesn't care whether you've been a good boy or a good girl this year.
As festive decorations go up in shops, South Africans will likely feel the bite of price increases, leaving their already debt-ridden wallets much emptier this Christmas.
Consumers have little chance of relief from record high fuel prices and worsening debt, and will probably have to pay more for imported goods because of the weaker rand.
Yesterday, the currency plummeted to nearly R9 to the dollar at one stage and was trading at around R8.77 later in the day .
Economists and the government have often encouraged consumers to pay off debt instead of incurring more, especially in this economic climate.
Holiday plans will be ruined by more expensive fuel and people planning to fly will have to watch SAA flight prices soar from today.
Four years ago, recession-hit consumers got some relief at the fuel pump. But now petrol and diesel prices are at an all-time high.
The price of petrol was increased to R12.20 last week and it looks likely that it will increase again soon with the rand diving to its lowest against the dollar in three years.
It might be increased by 3c a litre if the average rand-dollar exchange rate, and the average price of crude oil so far this month, are maintained. But if the rand remains as weak as R8.88 to the dollar - and oil prices stay at current levels - an increase of as much as 40c is on the cards.
The price at the pump is calculated using the price of imported crude oil and the rate of the rand against the dollar.
In September 2008, a litre of petrol cost R9.83 - a far cry from today's R12.20 - but it fell to R8.22 within three months, giving consumers some breathing space.
We are all paying a larger part of our disposable income to service debt, according to the Reserve Bank.
The ratio of debt to disposable income has increased from 75.6% in March to 76.3% at the end of June.
A report by the National Credit Regulator last month showed that another 170000 consumers fell behind on repayments in the past quarter and that almost a fifth of them have fallen more than three months behind.
But the quarterly Credit Bureau Monitor also showed that lending is still expanding at breakneck speed. In the past 15 months, the number of credit-active consumers has grown by one million.
The Reserve Bank has one chance left this year to cut interest rates and give consumers relief, but when its monetary policy committee meets next month, it will have to take heed of the effect the weaker rand will have on inflation.
Consumer inflation is at 5% and still comfortably within the Reserve Bank's target band of 3% to 6%. But the impact of more expensive fuel will have to be taken into account.
And the effect of the gaping current account deficit on investors' appetite for South African assets will not be ignored.
The reason for the rand's fall this week, said Malcolm Charles, portfolio manager for fixed income at Investec Asset Management, is "all the high-risk factors coming together".
He noted Moody's downgrading of government debt, the large current account deficit, policy uncertainty and the wave of strikes.